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EU-Azerbaijan Trade Turnover Reaches Record High in 2022

By Timucin Turksoy February 22, 2023

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Between January and December 2022, the trade volume between Azerbaijan and European Union countries exceeded $27.3 billion / Courtesy

The most recent trade turnover figures between Azerbaijan and the member states of the European Union (EU) have been disclosed by Peter Michalko, the EU Ambassador to Azerbaijan.

According to him, in 2022, the mutual EU-Azerbaijan trade reached a record high level.

“Latest news! EU [is] the strongest partner of Azerbaijan in trade in 2022! Just got the latest statistics: 52% of Azerbaijani foreign trade is with the EU [ and] 65.6% of exports go to the EU market! The highest level ever!” Michalko wrote on Twitter on Monday.

Between January and December 2022, the trade volume between Azerbaijan and European Union countries exceeded $27.3 billion.

The EU has long been the primary trade partner of Azerbaijan, typically accounting for over 50 percent of Azerbaijan’s exports to foreign markets. Regarding imports, the EU has ranked second, comprising 16 percent of Azerbaijan’s total imports.

The EU's primary imports from Azerbaijan consist of mineral fuels, lubricants, and related materials, with smaller portions of food and live animals, chemicals and related products, and manufactured goods. In contrast, Azerbaijan mainly imports machinery and transport equipment from EU nations. Additionally, the EU exports chemicals and related products, manufactured goods and articles, and food and live animals to the largest South Caucasus country.

Over the 15 years since the beginning of the EU Delegation’s operations in Azerbaijan, the EU has financed approximately 400 projects valued at €224 million ($238 million). These initiatives have included more than 50 twinning projects, which have involved experts and public agencies from EU member states, as well as governmental institutions in Azerbaijan.

Since the end of 2020, Azerbaijan has become a reliable energy partner for the EU due to its direct gas deliveries through the Southern Gas Corridor (SGC). In 2021, European consumers received a total of 8.2 billion cubic meters (bcm) of Azerbaijani gas, which rose to 11.4 bcm in 2022. It is projected to reach 11.6 bcm this year.

Azerbaijan has expressed its readiness and eagerness to provide additional natural gas to Europe by 2027. The Trans Anatolian Pipeline (TANAP), which is the largest component of the SGC, is expected to double its current annual supply capacity from 16 bcm to 32 bcm. Similarly, it has been reported that the Trans Adriatic Pipeline (TAP), which represents the SGC’s European segment, will transport 20 bcm per year instead of 10 bcm.

The foundation of the relations between the European Union (EU) and Azerbaijan is rooted in the EU-Azerbaijan Partnership and Cooperation Agreement, which has been in effect since 1999. The EU-Azerbaijan Partnership Priorities reflect the values and principles of the European Neighborhood Policy, and also focus on strengthening institutions and good governance, economic development and market opportunities, connectivity, energy efficiency, environment and climate action, and mobility and people-to-people contacts.

On November 14, 2016, the European Council adopted a mandate to negotiate an updated comprehensive agreement with Azerbaijan. The new agreement is expected to replace the 1996 partnership and cooperation agreement. It should better address the common objectives and challenges the EU and Azerbaijan face today. 

On July 11, 2018, the EU and Azerbaijan agreed on new partnership priorities which should guide and enhance the partnership over the coming years. Currently, negotiations on a new and upgraded framework agreement aimed at enhanced and mutually beneficial EU-Azerbaijan cooperation are underway.